Redress Schemes for Lettings Agency and Property Management Work
Since 1st October 2014 it has been a legal requirement for all letting agents and property management agents to belong to a Government approved redress scheme. The legislative framework for this requirement can be found on the GOV.UK website. This means that tenants, landlords, leaseholders and freeholders in the private rented sector will be able to complain to an independent organisation about the service they have received. The intention is that the requirement to belong to a redress scheme will help to weed out bad agents and property managers, driving up private rented sector standards.
This requirement will be enforced by Local Authorities, who can impose a fine of up to £5,000 where an agent or property manager who should have joined a scheme has not done so.
The 3 schemes are:
Ombudsman Services Property Tel: 0330 440 1634
Property Redress Scheme Tel: 0208 275 7131
The Property Ombudsman Tel: 01722 333306
What Is Meant By ‘Lettings Agency’ Work?
Lettings Agency work is work carried out by an agent in the course of a business in response to instructions from:
- A private rental sector landlord who wants to find a tenant
- A tenant who wants to find a private rental sector property
Lettings Agency work does not include the following, when done by someone who only does those things:
- Publishing advertisements or providing information
- Providing a way for landlords and tenants to make direct contact with each other
- Providing a way for landlords and tenants to continue communicating directly with each other
It also does not include things which are done by the Local Authority.
The intention is that all ‘high street’ and ‘web’ based letting agents, including charities, will be subject to the duty to belong to an approved redress scheme.
What Is Meant By Property Management Agents Work?
Property Management Work is work carried out by someone in the course of a business in response to instructions received from another person who wants to arrange services, repairs, maintenance improvement or to deal with any other aspect of the management of residential premises. It does not include things done by, amongst others, housing associations or local authorities who are social landlords. These organisations are already required to belong to the Housing Ombudsman Scheme.
The premises must consist of, or contain, a dwelling-house let under either a long lease, an assured tenancy or a protected tenancy.
What If You Are Already A Redress Scheme Member?
A lettings agent or property manager already belonging to The Property Ombudsman or the Ombudsman Services Property scheme will automatically become a member of the new approved scheme. Estate agents who are members of an existing redress scheme but who also carry out lettings agency work should check whether their existing redress scheme covers their letting agency work as well as their estate agency work and arrange membership of one of the new schemes if necessary.
What If A Letting Agent or Property Manager Doesn’t Join A Scheme?
A letting agent or property manager who fails to join one of the 3 approved Schemes can be subject to a £5,000 fine from the Local Authority and, ultimately, be closed down if they continue to breach their legal requirement to join one of the schemes.
All letting agents and property managers who have joined a redress scheme should notify the Private Sector Housing Team to confirm their membership. If you want to report a person or company who is involved in lettings or property management but who has not joined a scheme, please notify the Private Sector Housing Team with the details at email@example.com who will investigate further.
By joining a Scheme, the Agent or property manager agrees to comply with the Ombudsman’s decision. Failure to do so may result in the agent or property manager being removed from the Scheme and then finding it difficult to join another approved scheme.
More detailed information can be obtained from the attached publication ‘Lettings Agents and Property Managers – Which Government approved redress scheme do you belong to?’
You can also find more information at www.gov.uk.
Page last updated: 20/06/2017